2024-2028 Industrial Plan Update
Faced with the growing complexity of the energy system, which in recent years has posed new and important challenges to all operators in the chain, the Terna Group strengthened its role in the transition process by updating its 2024-2028 Industrial Plan - Empowering Tomorrow. While keeping the basic strategic lines unchanged, the update to the Industrial Plan, approved by the Board of Directors on 25 March 2025, reinforces the Dual Transition - Energy and Digital concept, deemed crucial for ensuring a fair and inclusive Just Transition for all stakeholders.
The update of the 2024-2028 Industrial Plan provides for total Capital expenditure of €17.7 billion, through which Terna will accelerate its commitment to the country’s energy transition, energy independence and decarbonisation, in keeping with the challenging objectives set in the National Integrated Energy and Climate Plan (PNIEC) and the targets in the EU’s Green Deal, which aim to cut greenhouse gas emissions by at least 55% by 2030, compared with 1990 levels.
At the heart of the 2024-2028 Industrial Plan update is the sustainability of investments, which is essential for the creation of value for the Company and the system as a whole. Terna’s capital expenditure, classified as entirely sustainable based on the EU Taxonomy, targets the development of renewable sources. The transmission backbones that transport energy from points of production, which are increasingly located in Italy’s southern regions, to where demand is highest in the north of the country, will be boosted by resolving existing issues caused by grid congestion and further development of cross-border interconnections. This will allow Italy to solidify its role as the electricity hub of Europe and the Mediterranean area.
The Terna Group’s development initiatives will continue to focus on two strategic areas: Regulated Activities in Italy and Non-regulated Activities.
The Regulated Activities in Italy will be the Terna Group’s core business, which with a total Capital expenditure of €16.6 billion intends to pursue the development and strengthening of the National Electricity Transmission Grid. The aforementioned target represents the largest Investment Plan ever, an increase of 7% compared to the previous 2024-2028 Industrial Plan, mainly due to increased investment in system security equipment, enhanced cyber security initiatives and the digitalisation of assets and processes. The high coverage both in terms of authorisations, where about 90% of the investments have already been authorised, and in terms of procurement, where about 80% of the requirements have already been covered by contract, ensures the overall sustainability of the Investment Plan.
As a result of the planned investment, the value of the RAB will reach about €32 billion in 2028, with a CAGR of 9% over the life of the Plan.
In the update of the 2024-2028 Industrial Plan, Terna confirmed the investments for the development of the National Transmission Grid for a total of €10.8 billion, mainly related to the construction of high-voltage direct current lines – to resolve grid congestion, increase transport capacity between different market zones, fully integrate renewable sources, and improve service quality – and the construction of submarine cable connections. The most important project is the Tyrrhenian Link, the power line that will connect Sardinia, Sicily and Campania and that will contribute to the development of renewable energy production and the phase-out of the most polluting coal and oil-fired power substations.The other projects include: the Adriatic Link (the submarine connection between the Marche and Abruzzo regions), Sa.Co.I.3 (the interconnector linking Sardinia with Corsica and Tuscany), Elmed (the Italy-Tunisia interconnector), and the 380 kV Chiaramonte Gulfi-Ciminna power line in Sicily.
With regard to ordinary investments primarily aimed at asset renewal and efficiency to rationalise existing infrastructure and replace obsolete components, Terna expects an increase in Capital expenditure that will total €3.6 billion, compared to the approximately €2.9 billion foreseen in the previous Plan.
Finally, an increase in investment is also planned for the Security Plan aimed at strengthening and boosting the technical and technological capabilities of the electricity system, where the Group will dedicate a total of €2.3 billion over the period of the Plan, compared to the approximately €1.7 billion foreseen in the previous Plan.
The Non-regulated Activities will continue to generate new business opportunities through the development of innovative and digital technology solutions consistent with Terna’s institutional role.
The markets of reference are undergoing rapid expansion, driven for the most part by trends linked to the energy transition: increased demand for renewable generation plants, the renewal of grids and the growth of new industrial sub-sectors such as data centres and large power consumers.
The Group’s Non-regulated Activities include:
• Equipment: businesses focused on guaranteeing supplies of essential components for development of the grid, such as transformers (Tamini Group) and cables (Brugg Cables Group);
• Energy services: market activities complementary and adjacent to the core business. These include all system integrator activities with specialised and diversified expertise in the design, construction, maintenance and efficiency of mediumand high-voltage electrical systems, renewables and storage systems (Altenia);
• Connectivity: connectivity offerings for telecommunications providers through the supply of dark fibre and housing services;
• Interconnectors: the installation and operation of interconnecting lines.
The Plan includes a series of initiatives designed to fully exploit the portfolio of businesses, introducing optimisation measures to strengthen financial performance and consolidate market leadership. These actions are aimed at keeping the business competitive with its competitors in the Equipment sector and further strengthening its leadership in Energy Services, considering that Non-regulated Activities will account for about €730 million in terms of cumulated EBITDA over the Plan period, in return for limited investment and risk exposure.
For Terna, digitalisation and innovation remain fundamental pillars for the achievement of national energy transition goals. In line with this orientation, the 2024-2028 Industrial Plan update plans to spend €2.4 billion for digital technology, amounting to approximately 15% of capital expenditures (capex) in Regulated Activities in Italy, in line with international forecasts and the ambitions of major European competitors.
The digital plan aims to further consolidate the importance of digitalisation in supporting the Development Plan, with a series of ambitious initiatives throughout the value chain. These include:
• engineering will introduce software to digitalise the planning of worksites (Building Information Modelling) and optimise the management of contracts, ensuring the on-time delivery of projects;
• dispatching will renew substation ICT architecture through the adoption of Substation Automation System (SAS) solutions and develop advanced network forecasting and optimisation models for the safe and economical operation of the National Electricity System;
• asset management will maintain current quality standards by digitising the O&M process using technologies such as digital twin, Internet of Things (IoT) and predictive tools.
In conclusion, advanced digital solutions will be used to constantly guarantee safety, drive innovation and improve worker efficiency.
Terna’s people, with their world-leading technical expertise, are a key asset in enabling the Group to achieve the challenging goals the Group has set itself. The people strategy is based on three key pillars: empowerment, experience and excellence. The Group aims to be people-centric, promoting the development and wellbeing of employees by giving them greater responsibility and through mutual engagement benefitting all parties. Working life will be improved by anticipating change, investing in emerging skills and enabling more effective ways of working, in part by harnessing technology. Furthermore, rewards will be provided for merit to accelerate the organisation’s growth and achieve excellent results. The Terna Group’s focus on people is confirmed by the important acceleration in job creation, the update of the 2024-2028 Industrial Plan confirming the estimates of the previous Plan that forecast an increase of more than 7,000 employees.
The update of the 2024-2028 Industrial Plan provides for total Capital expenditure of €17.7 billion, through which Terna will accelerate its commitment to the country’s energy transition, energy independence and decarbonisation, in keeping with the challenging objectives set in the National Integrated Energy and Climate Plan (PNIEC) and the targets in the EU’s Green Deal, which aim to cut greenhouse gas emissions by at least 55% by 2030, compared with 1990 levels.
At the heart of the 2024-2028 Industrial Plan update is the sustainability of investments, which is essential for the creation of value for the Company and the system as a whole. Terna’s capital expenditure, classified as entirely sustainable based on the EU Taxonomy, targets the development of renewable sources. The transmission backbones that transport energy from points of production, which are increasingly located in Italy’s southern regions, to where demand is highest in the north of the country, will be boosted by resolving existing issues caused by grid congestion and further development of cross-border interconnections. This will allow Italy to solidify its role as the electricity hub of Europe and the Mediterranean area.
The Terna Group’s development initiatives will continue to focus on two strategic areas: Regulated Activities in Italy and Non-regulated Activities.
The Regulated Activities in Italy will be the Terna Group’s core business, which with a total Capital expenditure of €16.6 billion intends to pursue the development and strengthening of the National Electricity Transmission Grid. The aforementioned target represents the largest Investment Plan ever, an increase of 7% compared to the previous 2024-2028 Industrial Plan, mainly due to increased investment in system security equipment, enhanced cyber security initiatives and the digitalisation of assets and processes. The high coverage both in terms of authorisations, where about 90% of the investments have already been authorised, and in terms of procurement, where about 80% of the requirements have already been covered by contract, ensures the overall sustainability of the Investment Plan.
As a result of the planned investment, the value of the RAB will reach about €32 billion in 2028, with a CAGR of 9% over the life of the Plan.
In the update of the 2024-2028 Industrial Plan, Terna confirmed the investments for the development of the National Transmission Grid for a total of €10.8 billion, mainly related to the construction of high-voltage direct current lines – to resolve grid congestion, increase transport capacity between different market zones, fully integrate renewable sources, and improve service quality – and the construction of submarine cable connections. The most important project is the Tyrrhenian Link, the power line that will connect Sardinia, Sicily and Campania and that will contribute to the development of renewable energy production and the phase-out of the most polluting coal and oil-fired power substations.The other projects include: the Adriatic Link (the submarine connection between the Marche and Abruzzo regions), Sa.Co.I.3 (the interconnector linking Sardinia with Corsica and Tuscany), Elmed (the Italy-Tunisia interconnector), and the 380 kV Chiaramonte Gulfi-Ciminna power line in Sicily.
With regard to ordinary investments primarily aimed at asset renewal and efficiency to rationalise existing infrastructure and replace obsolete components, Terna expects an increase in Capital expenditure that will total €3.6 billion, compared to the approximately €2.9 billion foreseen in the previous Plan.
Finally, an increase in investment is also planned for the Security Plan aimed at strengthening and boosting the technical and technological capabilities of the electricity system, where the Group will dedicate a total of €2.3 billion over the period of the Plan, compared to the approximately €1.7 billion foreseen in the previous Plan.
The Non-regulated Activities will continue to generate new business opportunities through the development of innovative and digital technology solutions consistent with Terna’s institutional role.
The markets of reference are undergoing rapid expansion, driven for the most part by trends linked to the energy transition: increased demand for renewable generation plants, the renewal of grids and the growth of new industrial sub-sectors such as data centres and large power consumers.
The Group’s Non-regulated Activities include:
• Equipment: businesses focused on guaranteeing supplies of essential components for development of the grid, such as transformers (Tamini Group) and cables (Brugg Cables Group);
• Energy services: market activities complementary and adjacent to the core business. These include all system integrator activities with specialised and diversified expertise in the design, construction, maintenance and efficiency of mediumand high-voltage electrical systems, renewables and storage systems (Altenia);
• Connectivity: connectivity offerings for telecommunications providers through the supply of dark fibre and housing services;
• Interconnectors: the installation and operation of interconnecting lines.
The Plan includes a series of initiatives designed to fully exploit the portfolio of businesses, introducing optimisation measures to strengthen financial performance and consolidate market leadership. These actions are aimed at keeping the business competitive with its competitors in the Equipment sector and further strengthening its leadership in Energy Services, considering that Non-regulated Activities will account for about €730 million in terms of cumulated EBITDA over the Plan period, in return for limited investment and risk exposure.
For Terna, digitalisation and innovation remain fundamental pillars for the achievement of national energy transition goals. In line with this orientation, the 2024-2028 Industrial Plan update plans to spend €2.4 billion for digital technology, amounting to approximately 15% of capital expenditures (capex) in Regulated Activities in Italy, in line with international forecasts and the ambitions of major European competitors.
The digital plan aims to further consolidate the importance of digitalisation in supporting the Development Plan, with a series of ambitious initiatives throughout the value chain. These include:
• engineering will introduce software to digitalise the planning of worksites (Building Information Modelling) and optimise the management of contracts, ensuring the on-time delivery of projects;
• dispatching will renew substation ICT architecture through the adoption of Substation Automation System (SAS) solutions and develop advanced network forecasting and optimisation models for the safe and economical operation of the National Electricity System;
• asset management will maintain current quality standards by digitising the O&M process using technologies such as digital twin, Internet of Things (IoT) and predictive tools.
In conclusion, advanced digital solutions will be used to constantly guarantee safety, drive innovation and improve worker efficiency.
Terna’s people, with their world-leading technical expertise, are a key asset in enabling the Group to achieve the challenging goals the Group has set itself. The people strategy is based on three key pillars: empowerment, experience and excellence. The Group aims to be people-centric, promoting the development and wellbeing of employees by giving them greater responsibility and through mutual engagement benefitting all parties. Working life will be improved by anticipating change, investing in emerging skills and enabling more effective ways of working, in part by harnessing technology. Furthermore, rewards will be provided for merit to accelerate the organisation’s growth and achieve excellent results. The Terna Group’s focus on people is confirmed by the important acceleration in job creation, the update of the 2024-2028 Industrial Plan confirming the estimates of the previous Plan that forecast an increase of more than 7,000 employees.
Furthermore, maintaining a solid capital structure supported by robust cash generation will continue to ensure an attractive dividend policy.
Finally, the Terna Group’s ongoing commitment to implementing the Industrial Plan and achieving the related financial targets has enabled the Group to meet and improve on the guidance communicated to the financial markets for 2024, which constitutes a solid starting point for the achievement of the new targets envisaged in the update of the 2024-2028 Industrial Plan.
Finally, the Terna Group’s ongoing commitment to implementing the Industrial Plan and achieving the related financial targets has enabled the Group to meet and improve on the guidance communicated to the financial markets for 2024, which constitutes a solid starting point for the achievement of the new targets envisaged in the update of the 2024-2028 Industrial Plan.
Identification and assessment of Industrial Plan risks
To evaluate the solidity and reliability of Terna’s Industrial Plan and respond to the needs of the Company’s key stakeholders, the Terna Group has adopted a methodology that integrates risk assessment and quantification into the business planning process.
To conduct this activity, the Administration, Finance and Control department uses a tool that assesses the degree to which the Group’s risk profile is compatible with its strategic goals. The identification and quantification of risks and opportunities (uncertainties) is applied to the Terna Group as a whole and requires the direct involvement of all the relevant departments in the form of specific interviews under a bottom-up approach.
The process requires that, once uncertainties have been identified and quantified, they are aggregated using a proprietary Monte Carlo simulation model that, starting from the data collected, generates a large number of alternative scenarios based on likely developments in the variables underlying the Industrial Plan. The methodology thus enables the Company to estimate the overall volatility of the financial targets deriving from the occurrence of key risk events and opportunities and to assess the resilience of the Industrial Plan.
To conduct this activity, the Administration, Finance and Control department uses a tool that assesses the degree to which the Group’s risk profile is compatible with its strategic goals. The identification and quantification of risks and opportunities (uncertainties) is applied to the Terna Group as a whole and requires the direct involvement of all the relevant departments in the form of specific interviews under a bottom-up approach.
The process requires that, once uncertainties have been identified and quantified, they are aggregated using a proprietary Monte Carlo simulation model that, starting from the data collected, generates a large number of alternative scenarios based on likely developments in the variables underlying the Industrial Plan. The methodology thus enables the Company to estimate the overall volatility of the financial targets deriving from the occurrence of key risk events and opportunities and to assess the resilience of the Industrial Plan.
Innovation strategy
The Twin Transition, or the dual transition involving both digital and energy, is at the heart of Terna’s strategy to build an increasingly sustainable, efficient, reliable and affordable electricity system. This is an ambitious and complex goal that requires a constant commitment to innovation and cutting-edge technology.
To meet this challenge, it is not enough simply to adopt new solutions: we need a clear vision of the future, a future where digitalisation and decarbonisation are the pillars of a “future-proof” energy system. Precisely for this reason, Terna is investing in the most advanced technologies and collaborating with various players in the innovation ecosystem (universities, research centres, large industrial companies, start-ups and small and medium-sized enterprises).
The company strongly believes in the value of innovative ideas and therefore supports start-ups capable of transforming ambitious insights into concrete models and technological tools that can improve the management of the national electricity grid. A grid that, with the increasing integration of renewables, needs increasingly intelligent solutions to ensure stability and efficiency.
For this process, the synergy between digital and energy becomes the key to meeting the challenges of the future and to driving the transition to a more sustainable and innovative electricity system.
These are the directions of technological development underpinning the 2025-2028 Innovation Plan, the four ambitions that guide every corporate innovation initiative aiming to have an increasing impact on the business through the adoption of Open Innovation approaches:
To meet this challenge, it is not enough simply to adopt new solutions: we need a clear vision of the future, a future where digitalisation and decarbonisation are the pillars of a “future-proof” energy system. Precisely for this reason, Terna is investing in the most advanced technologies and collaborating with various players in the innovation ecosystem (universities, research centres, large industrial companies, start-ups and small and medium-sized enterprises).
The company strongly believes in the value of innovative ideas and therefore supports start-ups capable of transforming ambitious insights into concrete models and technological tools that can improve the management of the national electricity grid. A grid that, with the increasing integration of renewables, needs increasingly intelligent solutions to ensure stability and efficiency.
For this process, the synergy between digital and energy becomes the key to meeting the challenges of the future and to driving the transition to a more sustainable and innovative electricity system.
These are the directions of technological development underpinning the 2025-2028 Innovation Plan, the four ambitions that guide every corporate innovation initiative aiming to have an increasing impact on the business through the adoption of Open Innovation approaches:
Terna’s Open Innovation model breaks down barriers between sectors and territories, facilitating the exchange of knowledge, ideas and resources with an entire community of innovators according to a concrete, open, inclusive and distributed approach, responding to identified innovation needs with the aim of developing, protecting and promoting the company’s skills and intellectual property.
Serving Terna’s Open Innovation strategy is the Terna Ideas platform31, the virtual space that represents a meeting point between the company’s internal creativity and the external talent of start-ups, researchers, innovative companies and solvers from all over the world. Tackling challenges dedicated to the energy transition, the most promising ideas are transformed into operational solutions, testifying to Terna’s willingness to integrate the best available skills and develop human capital.
Terna is also looking beyond Italy and strengthening its presence at the international level with the aim of exploring new models and innovative approaches, creating a global network capable of accelerating the transformation of the energy sector. To this end it has created Terna Innovation Zones, points of reference located in the world’s most advanced innovation ecosystems.
The first step in this direction was the opening of an Innovation Zone in Silicon Valley, in San Francisco, which was inaugurated during the Innovation Zone Forum held in October and organised by Terna with the support of the Italian Innovation and Culture Hub (INNOVIT), the Consulate General of Italy in San Francisco, and partner Mind the Bridge. Here, Terna has initiated an ongoing dialogue with start-ups, investors and researchers to identify cuttingedge solutions that can revolutionise the electricity system. Terna’s Innovation Zone in San Francisco is not just a technological outpost, but a catalyst for synergies, where Italian excellence meets the best international minds to tackle the challenges of the Twin Transition together. Note also that on 29 January 2025 the Terna Innovation Zone in Tunis was inaugurated, the first innovation hub in Africa that strengthens the strategic partnership between Italy and Tunisia.
In addition to consolidating the innovation model, at the end of 2022 the Terna Group created a further important tool to help it fulfil its ambitions. In November 2022 Terna Forward was established, the Corporate Venture Capital vehicle of the Terna Group.
With the aim of supporting the most innovative Italian companies and accelerating high-impact solutions for the energy transition, Terna Forward supports promising start-ups through strategic investments, fostering the development of technologies that can improve the efficiency and resilience of electricity infrastructure. With an approach based on Open Innovation, Terna Forward not only finances the most disruptive initiatives, but also makes its expertise available to accompany them in their growth, contributing concretely to the transformation of the energy system. During 2024, Terna Forward, in addition to the investments made indirectly through its membership and active participation in CdP Venture Capital’s Corporate Partner I fund, completed four direct investment transactions in start-ups: Wesii S.r.l., a leading Italian company in inspection and remote sensing services in the energy sector, for a 33% stake, Melaworks, D-orbit and Unusuals World.
Terna’s journey in the Twin Transition shows how innovation can become a driver of sustainability. Through these initiatives, the company actively engages in driving change with vision and determination.
Key results achieved in 2024 include:
• 67 projects in progress;
• 73 IP assets in the patent portfolio (patents obtained and IP applications filed);
• 14 Scouting initiatives and 8 Workshops.
Serving Terna’s Open Innovation strategy is the Terna Ideas platform31, the virtual space that represents a meeting point between the company’s internal creativity and the external talent of start-ups, researchers, innovative companies and solvers from all over the world. Tackling challenges dedicated to the energy transition, the most promising ideas are transformed into operational solutions, testifying to Terna’s willingness to integrate the best available skills and develop human capital.
Terna is also looking beyond Italy and strengthening its presence at the international level with the aim of exploring new models and innovative approaches, creating a global network capable of accelerating the transformation of the energy sector. To this end it has created Terna Innovation Zones, points of reference located in the world’s most advanced innovation ecosystems.
The first step in this direction was the opening of an Innovation Zone in Silicon Valley, in San Francisco, which was inaugurated during the Innovation Zone Forum held in October and organised by Terna with the support of the Italian Innovation and Culture Hub (INNOVIT), the Consulate General of Italy in San Francisco, and partner Mind the Bridge. Here, Terna has initiated an ongoing dialogue with start-ups, investors and researchers to identify cuttingedge solutions that can revolutionise the electricity system. Terna’s Innovation Zone in San Francisco is not just a technological outpost, but a catalyst for synergies, where Italian excellence meets the best international minds to tackle the challenges of the Twin Transition together. Note also that on 29 January 2025 the Terna Innovation Zone in Tunis was inaugurated, the first innovation hub in Africa that strengthens the strategic partnership between Italy and Tunisia.
In addition to consolidating the innovation model, at the end of 2022 the Terna Group created a further important tool to help it fulfil its ambitions. In November 2022 Terna Forward was established, the Corporate Venture Capital vehicle of the Terna Group.
With the aim of supporting the most innovative Italian companies and accelerating high-impact solutions for the energy transition, Terna Forward supports promising start-ups through strategic investments, fostering the development of technologies that can improve the efficiency and resilience of electricity infrastructure. With an approach based on Open Innovation, Terna Forward not only finances the most disruptive initiatives, but also makes its expertise available to accompany them in their growth, contributing concretely to the transformation of the energy system. During 2024, Terna Forward, in addition to the investments made indirectly through its membership and active participation in CdP Venture Capital’s Corporate Partner I fund, completed four direct investment transactions in start-ups: Wesii S.r.l., a leading Italian company in inspection and remote sensing services in the energy sector, for a 33% stake, Melaworks, D-orbit and Unusuals World.
Terna’s journey in the Twin Transition shows how innovation can become a driver of sustainability. Through these initiatives, the company actively engages in driving change with vision and determination.
Key results achieved in 2024 include:
• 67 projects in progress;
• 73 IP assets in the patent portfolio (patents obtained and IP applications filed);
• 14 Scouting initiatives and 8 Workshops.
